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KKR, Singtel seek S$5 billion loan for STT GDC buyout: sources

KKR, Singtel seek S$5 billion loan for STT GDC buyout: sources

By Kim Browne

Culture

If finalised, this deal could mark Asia’s largest-ever leveraged buyout financing in the data-centre sector

A consortium comprising of KKR and Singapore Telecommunications (Singtel) is in talks with banks for a loan of around S$5 billion to support its proposed purchase of ST Telemedia Global Data Centres (STT GDC), according to people familiar with the matter.

The deal may be structured as a bridge facility – equally split into a term loan and revolving credit tranche – and clubbed between a group of banks, the people said. They asked not to be identified discussing private matters.

A subsequent takeout financing could follow, they noted, adding that discussions are ongoing and details remain subject to change.

If finalised, this deal could mark Asia’s largest-ever leveraged buyout financing in the data-centre sector, according to Bloomberg-compiled data.

It will also contribute to a wave of big-ticket financings driven by surging demand for cloud services amid the region’s artificial intelligence boom.

The most recent comparable was a A$5.5 billion (S$4.7 billion) loan supporting Blackstone’s A$24 billion purchase of Australia’s AirTrunk in 2024.

Spokespeople for KKR and STT declined to comment, while Singtel did not respond to requests for comment.

Based in Singapore, STT GDC is one of Asia’s largest data-centre operators, with over 100 facilities across 20 markets including India, South Korea, Japan and Malaysia, according to its website. The company also maintains a presence in Europe, with operations in the UK, Italy and Germany.

The proposed buyout follows the consortium’s S$1.75 billion investment last year for a minority stake in STT GDC, Bloomberg News reported.

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KKR currently owns about 14 per cent of the firm while Singtel has a stake of more than 4 per cent. The rest of the company is held by ST Telemedia, which is wholly owned by Singapore state investor Temasek Holdings.

Following that transaction, KKR holds approximately 14.1 per cent of the company, while Singtel owns 4.2 per cent.

IFR reported on the potential financing earlier.

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Originally published by businesstimes.com.sg. Syndicated material does not necessarily reflect the views of Grazia British.

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